By Courtney Dentch
More than 500 people from Queens and elsewhere in the city got a lesson in the future of Social Security last week as officials from AARP made their case against plans to create private investment accounts using payroll taxes.
The AARP, a nationwide retirement organization, sponsored the forum last Thursday at the Radisson Hotel JFK Airport in Jamaica to discuss problems with the benefit program and proposed plans to change it.
Hundreds of people, arriving on buses from Harlem, Brooklyn, the Bronx and around Queens, filled two ballrooms at the hotel.
Social Security has provided a guaranteed income for millions of retirees since its inception nearly 70 years ago, said AARP President-elect Marie Smith. Black Americans have relied heavily on that income in their senior years, and for one in three black people, Social Security is the only source of revenue, she said.
“Historically, black Americans have received substantially lower incomes and pensions than white Americans,” she said. “The majority of black Americans are still more likely to depend on Social Security in their retirement.”
And while the program is under strain, Smith rejected claims it is in crisis.
“The program faces long-term financial problems,” she said. “Although Social Security is experiencing a surplus, it is projected to face shortfalls. It doesn’t mean it’s broke.”
The program and the projected revenues are expected to cover full benefits payments through 2042, but with roughly 76 million baby-boomers nearing retirement age, the program will reach a crisis stage if political leaders do not act now, Smith said.
“We need to quit putting this off,” she said. “The goal is to find a way to deal with this. Our leaders need to start planning now to strengthen Social Security.”
One proposed plan, which recommends taking a percentage of the payroll taxes paid into Social Security and putting them in an individual investment account, would weaken Social Security and create too much risk, Smith said.
“They want us to believe you’re going to get more,” she said. “You would have to hope the investment account replaces the benefits you lost. The benefits far outweigh those of the carve-out accounts.”
Instead, AARP would like to see a compromise that either increases the amount of money paid into the fund or increases the base for the fund, so more people are paying into Social Security, said Barton Fields, legislative council member for the group.
Some at the forum said Social Security is not enough to live on.
“Once upon a time I was a middle-class black woman,” one woman said. “Now I’m on Social Security and I have nothing.”
Smith urged people to plan for their financial futures but stressed this should be done on a personal basis.
“We encourage people to save and invest those savings, but personal savings and investment should be done in addition to Social Security, not in place of it,” she said.
AARP also used the forum to fire back at Federal Reserve Chairman Alan Greenspan, who suggested last week that the government cut Social Security benefits for future retirees to help ease budget deficits.
“The notion that Social Security should be a prime target to fix future budge deficits that are unrelated to the program is irresponsible,” said William Novelli, chief executive of AARP, in a statement. “Social Security is designed as a self-sustaining program and should be strengthened to ensure its long-term solvency. Social Security should not be a resource for negotiators over the federal budget deficit.”
The forum closed with a call to action.
“Go home and call your member of Congress and tell him or her to protect Social Security,” urged Gwendolyn Vaughn, director of the Queens Chapter of AARP. “It is in our power to make sure Social Security stays strong.”
Reach reporter Courtney Dentch by e-mail at email@example.com, or by phone at 718-229-0300, Ext. 138.